The main legal point established in the judgment is the interpretation of 'other Authorities' in Article 12 of the Constitution of India and the discretion of the High Court to issue writs against Cooperative Banks based on the facts of each case.

Justice A.M. Khanwilkar, C.J.

The Division Bench while hearing CWP No. 3634 of 2012-D vide order dated 20th July, 2012 has referred the following question to be considered by the Full Bench:

“Whether the Kangra Central Co-operative Bank, the Himachal Pradesh State Co-operative Bank Ltd. and the Jogindra Central Co-operative Bank, are ‘State’ within the meaning of Article 12 of the Constitution of India and whether a writ would lie against them?”

2. The question, as formulated raises two independent issues. Firstly, whether the stated Cooperative Banks are State within the meaning of Article 12 of the Constitution? The second question, which, in our view is an independent question, is, whether a writ would lie against those Cooperative Banks?

3. As regards the first part of the question formulated by the Division Bench, the sweep of expression “other Authorities” occurring in Article 12 of the Constitution of India is the core issue. That, however, is no more res integra. The leading judgment of the Apex Court is in the case of R.D. Shetty vs. The International Airport Authority of India and others 1979 SCC (3) 489. The exposition in this judgment came to be summarized in the judgment of another Constitution Bench of the Apex Court in the case of Ajay Hasia and others vs. Khalid Mujib Sehravardi and others (1981) 1 SCC 722. The tests laid down in the case of International Airport Authority have been culled out in para 9 of this judgment while making it clear that those tests are not conclusive or clinching but they are merely indicative indicia, which have to be used with care and caution. The Court observed that while stressing the necessity of a wide meaning to be placed on the expression “other Authorities”, it must be realized that it should not be stretched so far as to bring it in every autonomous body, which has some nexus with the Government within the sweep of the expression, which has to be tempered by a wise limitation. It may be apposite to reproduce the relevant portion from paragraph 9 of this very judgment, which reads thus:

“9. …...We may summarise the relevant tests gathered from the decision in the International Airport Authority case as follows:

(1) One thing is clear that if the entire share capital of the corporation is held by Government, it would go a long way towards indicating that the corporation is an instrumentality or agency of Government. (SCC p. 507, para 14)

(2) Where the financial assistance of the State is so much as to meet almost entire expenditure of the corporation, it would afford some indication of the corporation being impregnated with governmental character. (SCC p. 508, para 15).

(3) It may also be a relevant factor … whether the corporation enjoys monopoly status which is State conferred or State protected. (SCC p. 508, para 15).

(4) Existence of deep and pervasive State control may afford an indication that the corporation is a State agency or instrumentality. (SCC p. 508, para 15).

(5) If the functions of the corporation are of public importance and closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government. (SCC p. 509, para 16).

(6) “Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference of the corporation being an instrumentality or agency of Government (SCC p. 510, para 18)

If on a consideration of these relevant factors it is found that the corporation is an instrumentality or agency of government, it would, as pointed out in the International Airport Authority case, be an ‘authority’ and, therefore, ‘State’ within the meaning of the expression in Article 12.”

4. We may also reproduce the exposition in paragraph 11 of the decision, which is very instructive. The same reads thus:

“11. We may point out that it is immaterial for this purpose whether the corporation is created by a statute or under a statute. The test is